Bank of America's technical strategists have suggested that the price of gold could potentially experience a decline before recovering.
Following this expected decline, they then envisions the possibility of gold prices rebounding to an all-time high. If the price of gold remains at or above $1,800 per ounce, there is a potential for this new high to be attained by the end of the year, the strategists wrote in a client note.
However, in the event that the $1,800/oz support is breached, the gold price could conceivably remain range-bound for several subsequent quarters, they warn.
When it comes to the individual gold stocks, they highlight Kinross Gold (NYSE:KGC), IAMGOLD (NYSE:IAG), and Eldorado Gold (NYSE:EGO) as names that stand out as having particularly material downside relative to peers.
“The same precious metals miner that have downside risk, would then be the stocks that offer the most upside leverage to a gold price rebound,” BofA analysts wrote in a client note.
At the time of writing, spot gold prices are exchanging hands at $1,895.